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Jabal Omar Development Company, one of Saudi Arabia’s largest listed property developers, on Thursday said it is optimistic about the improving operating environment even as its third-quarter net loss has widened.
Net loss for the third quarter of 2021 reached 270 million riyals ($72 million), up from a net loss 236.95 million riyals in the same period in 2020, due to higher financial charges and Zakat provisions, the company said in a disclosure to the Saudi Stock Exchange (Tadawul).
Revenue for the quarter improved slightly to 43.12 million riyals from 1.93 million riyals a year earlier, but it was insufficient to offset reduced income from retail and hospitality operations that were hit by pandemic-related lockdowns and mobility restrictions.
For the nine-month period, the developer managed to narrow its net losses by over half to 344.77 million riyals, compared to a net loss of 917.78 million riyals in the same period last year, supported largely by proceeds from the sale of land in December 2020 which generated 830 million riyals.
Accumulated losses as of September 30, 2021 reached 2.47 billion riyals, equivalent to 26.6 percent of the total capital.
Jabal Omar, which operates hotels, residential and commercial properties within the Grand Mosque area in the holy city of Mecca, was hit hard by the decline in pilgrim arrivals.
Khalid Al Amoudi, CEO of Jabal Omar Development Company, said the company was optimistic about the improving operating environment and the return of pilgrims.
"The early signs are positive, as steps taken by the government to ease travel restrictions, social distancing guidelines and other controls specific to Hajj and Umrah, are lifted,” he added.
Wael El Turk, CFO, added that the company is in the “middle of restructuring” more than 15 billion riyals in liabilities and aims to decrease total liabilities and improve liquidity by reducing debt servicing levels by more than half.
(Writing by Brinda Darasha; editing by Cleofe Maceda)
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